COLUMBUS, Ohio, Oct. 19, 2001 – American Electric Power announced today that the U.S. Bankruptcy Court for the Eastern District of Kentucky has approved the company’s reorganization plan for the Quaker Coal Co.
As a result, AEP will acquire substantially all the assets of Quaker in resolution of the Chapter 11 bankruptcy proceedings initiated by Quaker.
The AEP plan was one of three alternatives considered by the court. AEP filed the plan as an unsecured creditor of Quaker Coal.
AEP will pay $101 million to creditors for Quaker assets that include surface and coal mining operations and associated facilities and coal reserves in Kentucky, Ohio and West Virginia; coal reserves in Pennsylvania; and interests in Colorado. AEP also will assume associated liabilities of $47 million. AEP will continue to operate Quaker’s active mines and associated businesses, which employ approximately 840 people.
“We have significant experience in the ownership and successful operation of coal mines and associated businesses,” said Dwayne L. Hart, senior vice president – business development for AEP Energy Services Inc. “This was an opportunity to purchase assets at a reasonable price.”
“We believed our plan was a good plan, and that of the three plans filed with the court, ours provided greater value and certainty for creditors,” said Charles A. Ebetino, Jr., AEPà¯¿½s senior vice president – mines. “The court agreed.”
Acquisition of the Quaker mines is expected to increase AEP’s coal production by approximately 7 million tons.
AEP also maintains ownership interests in lignite reserves in east Texas and northwestern Louisiana. AEP’s Southwestern Electric Power Co. (SWEPCO) subsidiary operates the Dolet Hills Lignite Co. in Mansfield, La., which produces approximately 3 million tons of lignite per year for the nearby Dolet Hills Power station, which is co-owned by SWEPCO and CLECO Power LLC (Cleco) and operated by Cleco.
AEP Energy Services Inc. is a subsidiary of AEP involved in trading and marketing energy commodities, including electric power, natural gas, natural gas liquids, oil, coal and sulfur dioxide allowances in North America and Europe.
American Electric Power is a multinational energy company based in Columbus, Ohio. AEP owns and operates more than 38,000 megawatts of generating capacity, making it America’s largest generator of electricity. The company is also a wholesale energy marketer and trader, ranking second in the U.S. in electricity volume with a growing presence in natural gas. AEP provides retail electricity to more than 7 million customers worldwide and has holdings in the U.S. and select international markets. Wholly owned subsidiaries are involved in power engineering and construction services, energy management and telecommunications.